MSC Industrial (NYSE:MSM) saw its shares rise over 3% in early Tuesday trading following the release of its fiscal third-quarter results. The company exceeded earnings expectations even though both profits and sales fell compared to the previous year.
Adjusted earnings per share came in at $1.08, beating analyst estimates of $1.03. Revenue for the quarter reached $971.1 million, slightly surpassing forecasts of $970.26 million. However, net sales dropped 0.8% from the same period last year, while adjusted diluted EPS declined 18.8% from $1.33.
CEO Erik Gershwind commented, “We delivered fiscal third quarter results that were in line with our expectations.” He added that MSC is seeing “early signs of progress” in revitalizing its core customer base, expanding high-touch solutions, and improving cost efficiency.
Operating income totaled $82.7 million, or $87.2 million on an adjusted basis. The adjusted operating margin stood at 9.0%, down from 11.4% a year earlier.
CFO Kristen Actis-Grande highlighted the company’s shareholder returns, stating that MSC distributed $56 million in dividends and share buybacks during the quarter, bringing the total returned so far this year to $181 million.
Looking ahead, MSC anticipates average daily sales growth in the fourth quarter to range between -0.5% and 1.5% year-over-year. The company also reiterated its full-year guidance, forecasting free cash flow conversion near 120% and capital expenditures between $100 million and $110 million.